Clearwater Mortgage Blog

If you’re relocating to Clearwater, FL, or planning to buy a new home, you may be wondering if you should purchase a condominium or a house. This choice has a lot to do with your lifestyle and what’s important to you. Depending on the location, condos can be less expensive. But not always. Condos are definitely easier to maintain, which can be a considerable advantage if you’re a snowbird. Let’s look at some of the other differences:

Single Family Homes Retain Their Value

In most cases, a house will keep its value better than a condo. That is unless you’re talking beachfront property. Even though houses cost more upfront, they can be a better investment for these two reasons:

Depending upon the location and neighborhood, in the Tampa Bay area, it’s generally easier to sell a house. It's because they’re in higher demand than condominiums and townhomes.

Growing families want a house with a yard for their kids and pets. At Clearwater Mortgage about 20% of our borrowers are purchasing a condo. That's compared to the other 80% going for the house, picket fence, and room to grow!

Single Family Homes are Easier to Finance

Lenders love stand-alone houses. This is because the homeowner has more control of the property and so would the lender. In most cases, there aren't any association rules.  Plus, the borrower owns the home and the land. Whereas with a condo, the owner only owns the inside walls.

There are more choices for mortgages. For example conventional, FHA, VA loans are all available for houses. Whereas FHA seldom lends on a condo unless it’s on an approved condo list.  And the approved list in Pinellas County is short!

Interest rates can be lower. But of course, this depends on quite a few things. For example credit history, cash down, and age and condition of the property. If you’re comparing your options, give Clearwater Mortgage a call at 727-259-2900.  We’ll be happy to run the numbers for you.

Condominiums are Much Easier to Maintain

If you want low maintenance, take a look at either condos or townhomes. You’ll have more time to spend at the beach!

No more mowing the lawn or replacing siding, windows, and roofs. Lower maintenance is a huge advantage especially if you’re a snowbird. Many of our borrowers come from New Jersey, Canada, Michigan, and Ohio. Like most retirees, they just want to have fun in the sun, and that doesn’t include a lot of chores.

But, even though there’s less to do around the house, you still may have added fees for upkeep. So if you’re considering a condo, it’s important to make sure it’s in excellent condition before you take the leap. You don’t want to buy and then find out you have to help pay for a new roof or an expensive swimming pool upgrade.

If Privacy is Important – There’s No Place Like a Home

Picture yourself surrounded by neighbors – close by, in fact just on the other side of the wall. If this gives you the shivers, a house is a much better choice. But, if you enjoy having lots of friends and activities, consider a condo. The condo associations in Tampa Bay are among the best in the US for creating a sense of community.

One good way to make a decision is to visit the complexes and communities you’re considering. Make sure you stop by during different times and days. The same thing goes for neighborhoods – it’s essential to make sure you’ll be happy where ever you buy.  So, get to know your neighbors first.

What about Association and Condo Fees in Tampa Bay?

Even with single-family dwellings, you can have association fees. If you’re interested in a property, ask your realtor if there are any association fees.

  • When purchasing a condominium or townhome, you will have monthly costs so be sure to include those in your budget. Some fees can be quite high, this is especially true if you’re looking at a beach property.
  • No matter what you decide on, give Clearwater Mortgage a call today at 727-259-2900, and we’ll go over your options.

Posted by Carol Youmans on October 17th, 2019 2:22 PM

Pre-Qual Letter Clearwater Mortgage

If you’re getting ready to shop for a home, you’ve probably heard that you need to get “pre-qualified” by your mortgage broker. And, you might be wondering – Why and How? Well, read on, and we’ll tell you everything you need to know.

The 2 Top Reasons to Get Pre-Qualified

Reason #1: Just picture yourself, it’s a beautiful weekend, and you’re out looking at homes. Ah! You find one you absolutely love, and you want to put in an offer. But – you can’t because you’re not pre-qualified yet. Darn.

Reason #2: You need to know how much you can really afford to buy. Nothing is worse than falling in love with a $400,000 home only to find out you really can only qualify for $350,000.

How Does Mortgage Prequalification Work?

To get pre-qualified, you need to fill out a loan application. You can do it online, on the phone, or face-to-face. It’s up to you. The advantage of doing it over the phone or in-person is that you can check out the loan officer and see if you like them.

It’s vital that you know, like, and trust who you’re working with. Also, if you’re a new homebuyer, it’s super helpful if your loan officer explains the home loan process in easy to understand English instead of “mortgage speak.”

With Clearwater Mortgage, you can fill out an application online, call us, or come into our office and meet us. No matter how you do it, you’ll be asked questions about your income, assets, and debts. You’ll also have your credit pulled.

If possible, it’s good to set aside a little time (30 to 45 minutes), so you can answer all the questions thoroughly.

What is Needed for a Pre-Qual Letter?

Once your application is complete, it’s time for you to provide some paperwork.

Here are the basics of what you’ll need if you have a job.

  • Drivers License or Government ID
  • Most recent 30 days of paystubs
  • 2018 W2’s
  • Most recent 2 months bank

If you’re self-employed, you’ll need to provide a bit more.

The faster you get this data together, the quicker you’ll get your letter.

How Long is a Pre-Qual Letter Good For?

Generally, a pre-qual letter is good for about 3 months. During that time, it’s essential to stay in close touch with your loan officer and let them know if any changes might affect your situation.

For example, if you change jobs, take out a new credit card, buy a new car – all of these things can mess up your pre-qualification.

A good rule is when you’re shopping for a house, don’t make any job changes or take out any credit before you ask your loan officer.

How Long Does It Take to Get a Pre-Qualification Letter?

The faster you get your documentation back to your loan officer, the quicker you’ll get your pre-qual letter. Once you have your letter in hand, it’s time to go shopping with your realtor and find a house!

At Clearwater Mortgage, we push to get our clients pre-qualified fast! Once we have the items above, we can usually get the letter out the same day or the next day at the latest. Also, we know that often borrowers are shopping on the weekends so, we’re ready to help during off hours to get new shoppers pre-qualified quickly. Call us today at 727-259-2900.

Posted by Carol Youmans on October 17th, 2019 2:20 PM


Most of us are familiar with different types of mortgages for purchasing or refinancing real estate. Whether you're buying a house, condominium, or commercial property to fix and flip or rent out–you know there are fixed rates loans for 15 and 30 years as well as loans with variable rates. You're probably also familiar with conventional, VA, and FHA loans. But, what is a Hard Money Loan (sometimes called a Private Loan)? Read on to find out more.

Private Money is Just Like it Sounds

It's not money borrowed from a bank or a big institution. It's money borrowed from a private individual or individuals. You've probably borrowed money from friends or relatives. That's a loose example of a private loan. But in that case, it probably wasn't "secured" with anything other than your promise to pay it back. 

When a Private Money investor or lender loans out their money, it’s not surprising that the fees and rates charged are higher than what you'd receive from a credit union or bank.

Why Would Someone Need a Private Money Loan?

There are several reasons. For example, if your past credit history isn't that great. Maybe you've had a short sale, bankruptcy, or foreclosure. No lending institution, bank, or credit union will loan to someone with a recent bankruptcy. But Private Money lenders will.

Problems With The Property?

hard money loan for fixers

Another big reason investors and house-flippers love Private Money Loans is that they may have a property that a bank won't lend on. The property isn't in good enough shape and up to the bank's standards. Maybe it needs some major rehab work done before the bank would even consider lending on it.

Need Money Fast?

If you need your funds in a hurry, don't count on a bank, you'll only wind up frustrated. One significant advantage of Private Money lenders is that they can move fast.  You'll get the cash you need generally much quicker than going through a big institution.

It's All About Equity

One thing to know about Hard Money loans is they are based almost solely on equity. That means you'll have to have some skin in the game to play. Generally speaking, you'll need to have at least 35% equity in the property (if you're refinancing). If you’re purchasing a property, plan on having 35% to 40% to put down of your own money. And that's your own money - not from another lender. Here are some examples:

Office Building - You've found a great deal on an office building in Pinellas County. The price is $400,000. You would need to have a minimum of $140,000 to put down yourself to borrow the remaining $260,000.

Single Family Home - There's a super good deal on a house in Clearwater, but it needs work so the bank won't lend on it. They're asking $200,000. Be prepared to put down at least $70,000 and finance the other $130,000.

Private Money May Not Work on Primary Residence

If you need a loan on a home you're planning on living in, Hard Money might not work – you’d need to call us so we can get more information. You may need to go through a bank. Hard money is mainly for investment property like rentals, or a home you're going to fix up and immediately flip, or a commercial property like a restaurant or office building.

Hard Money Loans Are Great in a Hot Market

Tampa Bay Hard Money Lender

We all know that property in Tampa Bay is hot, and if you happen to find a good deal–you have to move fast. Here's an example: You see a house that's  $250,000 and a super good deal. You have almost all the cash you need - you're just short $100,000. The problem is, even though you have $150,000 to put down, no bank will give you a loan because of your credit. But a Private Money lender will, and it will probably be done pretty darn fast.

Contractors Love Private Money Loans

Are you a contractor who's found your dream dumpy home? Congratulations! But don't expect to get money from a bank until it's in great shape. With Hard Money, as long as you have at least 30% to put down, you have a good chance of getting enough to fix up the dump and sell it for a nice profit or rent it out for monthly cash flow.

We Can Do That Hard Money Loan!

Clearwater Mortgage is a Florida Broker  (Company NMLS# 921372) with over 20 years of experience in lending.

Give us a call at 727-259-2900

Check out our Facebook page @ https://www.facebook.com/Clearwatermortgage

Check out our website @ https://www.clearwatermortgage.com



Posted in:hard moneyPosted in:Purchasing and tagged: Investment loans
Posted by Carol Youmans on October 17th, 2019 2:13 PM


If you’ve been thinking about refinancing, but aren’t quite sure if it’s a good idea, read on for some quick tips.

 First of all, there are two types of refinance loans:

  • Rate-and-Term Refinance – is used when you want to get a better interest rate or change the length of the loan. For example, if you want a lower rate, or need to remove private mortgage insurance. Or if you want a 15-year mortgage instead of a 30-year. But there’s a caveat - the rate still has to be good. Sometimes this is truly a good deal depending upon what the market place is offering for 15-year rates – you have to check with your loan professional to see if this is a good time. For example, if you have a rate of 4.5% but the market is offering a rate of 3.5% that could really be worth it. The rate 15-year loan rate is a bargain, but sometimes it isn’t. One thing to keep in mind, though, is with a Rate-and-Term refinance­ - you can’t get any cash-out.
  • Cash-out Refinance – with this type of loan besides changing the rate and Term, you can also get cash out to consolidate debt, make home improvements, buy another property, or whatever else you’d want. If you’re an investor, getting cash-out from a property with a nice chunk of equity can be a way to come up with a down-payment for a new property. The rate might be a bit higher than a Rate-and-Term, but not always. 

Refinancing is a good idea under some circumstances. Here are a few:

Interest rates are better than what you have, and you plan to stay in your home for a while. If you think you may be moving within the next few years, refinancing might not be worth it because there are fees connected to any loan.

  •  You have private mortgage insurance you’d like to get rid of. Some borrowers can save $150+ a month when they get rid of their PMI. 
  •  You have credit cards and debts you’d like to consolidate. In some circumstances, it’s a good idea to pay off your high-interest credit cards by rolling the debt into your loan. But, you have to weigh your options because your new loan could be 15 to 30 years long.
  •  You have home improvements you’d like to do. Again – you have to weigh the costs of the loan versus the enjoyment of home improvements and increased equity.

 

At Clearwater Mortgage, we strive to do what is best for the borrower. If refinancing is a good idea, we’ll let you know. If not – we’ll tell you that too. But, no matter what–we’re always happy to hear from our past clients. 

Give us a call today at 727-259-2900 to see if it’s time to refinance.


Posted by Carol Youmans on October 17th, 2019 1:35 PM


When you start considering purchasing a new home, besides looking at houses and possibly condominiums, you'll also be running into mortgage terminology you may not be familiar with. Because of that, we've put together this list of the most common terms our borrowers ask us about. Knowing what these terms mean will make your mortgage loan process much smoother and easier to understand. 


#1 Loan to Value

When you meet with your mortgage broker, one of the first things they will talk about is "Loan to Value" (sometimes called LTV). This is a ratio that shows how much loan you're taking out vs. the value of the home. Here's the equation: Loan divided by Value (Loan/Value).

Here's are a few examples:

You're purchasing your first home and have saved up $10,000 for a down payment. You find a home that costs $250,000. Your loan to value would be 96%.

  • $10,000 (down payment)
  • $240,000 (loan amount)
  • $250,000 (home value)

Here's another example: 

You just sold your condominium and have $80,000 for a down payment on your next house. You go shopping and find your dream home with a price tag of $400,000. Your loan to value would be 80%.



  • $80,000 (down payment)
  • $320,000 (loan amount)
  • $400,000 (home value)

 

Each loan program has its own rules on what the LTV can be. FHA offers a loan that borrowers only need 3.5% down, so don't think you need thousands of dollars to get a home loan. The more money a borrower puts down, the less of a risk the lender has, which could reflect in a lower interest rate.

 

#2 Pre-Qualification Letter

Pre-Qualification – before you start to shop for a home, you'll want to get a "pre-qualification" letter from your lender. To do this, your loan officer will need to take a full application, which includes asking about your income, assets, and debts. You'll also need to provide some documentation like:

  • Paystubs
  • Taxes
  • Bank statements

 The faster you get this data to them, the faster you'll get your pre-qual letter. Once you have that letter in hand, then it's time to go shopping with your realtor and find a house!

 

#3 Underwriter

Each lender has an underwriting department with underwriters who review a borrower's application to see if they meet the specific guidelines of the mortgage they are applying for.

 The main three things they look at are called the 3-Cs.

  • 1) Credit
  • 2) Capacity (ability to repay)
  • 3) Collateral (amount of down payment)

 

Here's how the loan process works:  

  1. Your loan officer takes your application and gets documentation from you.
  2. If everything looks good, you received your pre-qualification letter.
  3. House shopping begins!
  4. You find a home you like and put in an offer.
  5. Your offer is accepted.
  6. Your loan officer submits all of your data along with the property information to the lender.
  7. The underwriter will review your file and give you an initial pre-approval and or ask for more information and documentation.

 

More Paperwork

In most cases, the underwriter will ask for more information and additional documentation. Be ready and willing to provide this quickly. That will make your loan move much faster.

 

#4 Pre-Approval  

The pre-approval is different from the "pre-qualification" letter. A pre-approval is from the underwriter saying that your loan file looks good, and you are pre-approved.

Once in a while, a borrower will be "pre-approved," but then there's something wrong with the property that makes the lender not want to lend on it. For example, if the roof is in bad shape and needs to be replaced or if there's extensive dry rot. In those cases, the property isn't acceptable, but you, as the borrower is still pre-approved. If a problem like that comes up with a house, it just means you have to go shopping again.

 

#5 Debt-To-Income

Debt to Income sometimes called DTI. This ratio compares your monthly expenses (housing, credit cards, car payments) to your pre-tax income. The higher your income is and lower your debt, the better. Here's an example:

  • $1,000 (monthly debts)
  • $4,000 (pre-tax monthly income)

In the above case, your debt to income ratio is 25%, which is good.



This ratio is an important one and is one of the primary ways lenders and underwriters determine the amount of a home loan you can afford. 

Generally, you want to keep this ratio at 43% or lower to be approved. When you understand this critical ratio, you'll know why it's smart to stay within your budget when shopping for a house. You don't want to be shopping for something more expensive than you can afford and be disappointed when you can't get a loan.

When you're ready to start shopping or just want to see what you could be qualified for - give Clearwater Mortgage a call at 727-259-2900



Posted in:Purchasing
Posted by Carol Youmans on June 13th, 2019 3:04 PM

Some of the most common questions our borrowers ask are around fees and loan estimates, so we thought we’d give you more data about the costs involved in a mortgage loan.


Sample Loan Estimate


Once you’ve found a home and have a signed contract with the seller, let your mortgage lender know right away. They will give you a loan estimate within three days. This document lists all of the “estimated” costs of your loan. Here’s a sample of one.

What’s important to realize is that it’s just an estimate. At Clearwater Mortgage, we try and give the most accurate estimate we can, but there are many fees included that the mortgage broker doesn’t have any control over. We know what our costs will be, but for other vendor fees like title and homeowners insurance, we estimate as accurately as we can. 

Here are some costs other than lender fees that are listed on the loan estimate which other companies and government agencies determine the amounts of: 

Property taxes - (assessed by the County you’re in). Property taxes can vary from one home to the next – especially in Pinellas County or Pasco County. So, if you find a home you’re interested in, ask your realtor what the current taxes are. That will give you an idea of what you’ll have to pay. 

Most buyers have an escrow account, especially if you’re not putting 20% down. With an escrow or impound account, your taxes and insurance are paid along with your mortgage each month. So, when you buy the house, you’ll need to pay for some months of taxes ahead of time to get your account set up. The number of months you pay will vary depending on what month of the year you’re purchasing your new home. 

Title Fees – The owner’s title policy in Pinellas and Pasco Counties is usually paid by the seller. It just depends on what’s in your contract. And in most cases, the title company is chosen by the seller’s realtor. At Clearwater Mortgage, as soon as we get an executed contract, we call the title company and ask for their fees to put into the loan estimate. 

Appraisal – this runs between $350 to $500 depending upon loan and property type. If you’re buying a rental, the cost can run around $800 because there is additional data needed on investment properties. For example, the appraiser may need to find out what rents go for in that neighborhood. The appraisal is paid for at the time of service, so make sure you have that money available even if it’s on a credit card. 

Homeowners Insurance – even if you have an insurance agent you use all the time, it’s a good idea to shop for this to get your best rate. To get your escrow account established, you’ll need to pay for 12 months of insurance and an additional three months. Here’s more data about escrow accounts

Flood Insurance – In all of Florida, especially beach areas like Clearwater, flood insurance can be costly. Check the flood zone. If it’s designated “AE,” that’s prone to flooding, and you’ll have to get flood insurance. You can check a specific address on FEMA’s website here.  

 

Comparing Lenders with Your Loan Estimate


So, if you’re comparing lenders here are the only fees to compare:

  • Loan amount
  • Interest Rate
  • Origination Charges
  • Application Fee
  • Underwriting Fee
  • Credit Fees

Those are the fees the lender has control over. 


Cash to Close


The number to also watch out for is “Cash to Close.” It's on the bottom of the first page of the estimate. Depending upon how much money you want to put down and the sales price, your cash to close will vary. You’ll want to make sure you have enough money when it comes time to close your loan and get the keys to your new home. 

At Clearwater Mortgage, our goal is to make the mortgage process easy to understand. Give us a call at 727-259-2900 or apply online today

Posted in:RefinancePosted in:Purchasing and tagged: Closing Costs
Posted by Carol Youmans on June 7th, 2019 6:32 PM


When you're in the market to buy a new home, you might also be shopping around for a mortgage lender and comparing programs, rates, and closing costs. The trick in comparing mortgages from different lenders is to make sure you are comparing apples to apples. Doing that is easier said than done. Hear me out. 


What Is A Lender Fee Sheet?


A lender fee worksheet is a detailed list and breakdown of closing costs and expenses for a mortgage. It's a way to compare programs if you know what you're looking for.

Lender A gives you an estimate based upon a conversation on the phone with limited or no documentation regarding your finances.

It's not that this is bad. But, it's really just a ball estimate until your financials are in hand, and he can analyze them against various loan programs. Whatever information you told, the loan officer is what he is basing his loan estimate on


For Example:

"Well, my credit score on Credit Karma is 740 (credit Karma is not accurate for mortgage lending)". or 

"My income is $7000 a month and my wife makes $1000".


It might be a bit different when we see your tax returns. And, possibly, we may need to structure the loan in a way that your wife's income won't count. For example, if her credit score turned out lower than we wanted. 

We need very accurate data and a full application to get an exact estimate. Until then, we can give a "ballpark" estimate called a fee sheet. 


What is a Loan Estimate?


Later, when you have the exact property picked out, and we have all of your documentation, we can give a very solid estimate. That is called a Loan Estimate. By law, only certain parts of this can change after we give it, and by only specific pre-ordained amounts and under only certain conditions. 

Make sure you are not comparing a Fee Sheet to a Loan Estimate. 


Interest Rates Change Daily


Since interest rates change daily, comparing two loan estimates against each other can be a bit deceiving, especially if the estimates aren't on the same day. It can also be tricky if you are not comparing identical programs.


What if the Lender Can't Perform?


Stay tuned for part two of "Comparing estimates from different lenders," where we will go over some more caveats to consider. 


In the meantime, when you're ready to get pre-approved, give us a call at 727-259-2900. 


Posted in:RefinancePosted in:Purchasing and tagged: Closing Costs
Posted by Carol Youmans on May 17th, 2019 7:47 PM